According to official data released Tuesday, China’s annual aluminum output in 2022 rose 4.5% from a year earlier to a record high, reaching 40.21 million tonnes on the back of new capacity launched and easing. of power supply restrictions.
The National Bureau of Statistics (NBS) reported that primary aluminum production for December was 3.43 million tons, slightly up from November’s 3.41 million tons and 10.3% higher than the previous year. .
Due to higher spot prices, foundry revenues also increased in December. According to local industry information provider Mysteel, the smelter’s profit increased by 288 yuan (42.63 US dollars) per tonne per month. Production in December was approximately 110,645 tons per day, compared to approximately 113,667 tons in November.
Smelters increased output across the board in 2022 due to easing power usage rules and opening up additional capacity, mainly in Inner Mongolia in the north and Guangxi and Yunnan provinces in the southwest.
The price of light metal used in the construction, transportation and packaging industries came under pressure due to increased domestic supply and sluggish demand affected by the pandemic.
In 2022, the most active aluminum contract on the Shanghai Futures Exchange, ALI1!, averaged 18,685 yuan per tonne, up from 19,940 yuan a year earlier.
According to Lucy Tang, a metals analyst at S&P Global Commodity Insights, domestic aluminum demand is forecast to rise in 2023 as China anticipates a recovery in the property market following the relaxation of COVID regulations.
Aluminum in China and Europe
According to a metals analyst, continued expansion in the photovoltaic vehicle and new energy sectors may also provide support. As a result of the increased demand, production should increase further. According to CITIC Futures Research, production will increase by around 6% from 2022 to 42.44 million tons this year.
Despite falling inventories and expectations of significant deficits due to the persistence of the electricity crisis, particularly in Europe, and the need for smelters to reduce production, aluminum prices continued to rise in January, exceeding 2,900 dollars a ton, the highest level since late October. 2022.
Europe’s largest aluminum smelter, Aluminum Dunkerque Industries France, plans to cut production by 15%. At the same time, the second largest, Alcoa Corp., will stop producing aluminum at its Spanish facilities for two years. Since mid-March, aluminum inventories in LME-approved warehouses have decreased by more than 50%. Meanwhile, Indonesia’s thermal coal export ban has resulted in a rise in coal costs, which is likely to cause Chinese and Indian aluminum output to decline.
Ten non-ferrous metals, including copper, aluminum, lead, zinc and nickel, saw production increase in December by 7.3% to 5.95 million tons. Production for the full year rose 4.3% to a record 67.74 million tons. Tin, antimony, mercury, magnesium, and titanium are the other non-ferrous metals included in this group.
